Uniqulo

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  • Topic: Tadashi Yanai, Fast Retailing, Japan
  • Pages : 7 (2079 words )
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  • Published : May 23, 2013
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I chose the company is UNIQLO. UNIQLO is a Japanese casual wear designer, manufacturer and retailer. The company founded in 1949 by Yamaguchi Abe. It was called Fast Retailing Co at that time. In November 1998, they opened their first urban UNIQLO store in Tokyo’s trendy Harajuku district, and outlets soon spread to major cities throughout Japan. In 2001, sales turnover and gross profit reached a new peak, and with over 500 retail stores in Japan, Uniqlo decided to expand overseas, establishing Fast Retailing (Jiangsu) Apparel Co., Ltd. in China (and in 2002, opening their first Chinese Uniqlo outlet in Shanhai) and opening their first four overseas outlets in London, England. In 2005, UNIQLO stores opened in the United States (New York), Hong Kong and South Korea. UNIQLO has been struggling to expand business overseas many countries recent years. That’s why a number of UNIQLO stores have established all over the world. According to the website, there are 851 stores in Japan, 234 overseas stores as of the end of 2012. As a result, year 2011 annual revenues were 600.1 billion yen (7.5 billion U.S dollars) in the country (Japan), 93.7 billion yen (1.1billion U.S dollars) in foreign countries.

One of the organization goals is that UNIQLO announced that the company would target annual group sales of 5 trillion yen (about 61.2 billion US dollars) and pretax profit from operations of 1 trillion yen (about 12.2 billion US dollars) by 2020. This means that the company is aiming to become the world’s biggest SPA with a continuous growth rate of 20% per year. The figure breaks down as 1 trillion yen from UNIQLO Japan business, 3 trillion yen from its international business, and 1 trillion yen from Japan-related and global brand business. The company’s international business target of 3 trillion yen breaks down as 1 trillion yen in China, 1 trillion yen in other Asian countries and 1 trillion yen in Europe and the United States.

~ Environmental domain~

The environment of an organization can be understood by analyzing its domain within external sectors. I’m going to explain some of environmental domain about UNIQLO. 1, Industry sectors-In 1997, they adopted a set of strategies from American retailing giant The Gap, known as "SPA" (Specialty-store/retailer of Private-label Apparel), meaning that they would produce their own clothing and sell it exclusively.

2, International sector- UNIQLO has expressed a desire to open a store in every major U.S. city, and up to 200 stores in the country. For example, In November 2006, UNIQLO opened its first flagship store in the SoHo fashion district of Manhattan, New York City. Moreover, they already opened store in France, England, Singapore, Malaysia, Taiwan, Thailand, Philippines and so on.

3, Raw Materials sector-UNIQLO had begun outsourcing their clothing manufacturing to factories in China where labor was cheap, a well-established corporate practice. Moreover, there are manufacturing to factories in Thailand, Cambodia, and Myanmar etc. Japan was in the depths of a recession at the time, and the low-cost, high-quality goods proved popular. Their advertising campaigns also proved fruitful.

~ Environmental uncertainty~

Uncertainty is that decision makers do not have sufficient information about environment factors, and they have difficult time predicting external changes. In 2009, UNIQLO told us that the company would target annual group sales of 5 trillion yen (about 61.2 billion US dollars) and pretax profit from operations of 1 trillion yen (about 12.2 billion US dollars) by 2020. In my opinion, the part is environmental uncertainty. There are some reasons. First, they expect the number is too high. It’s almost nine times last year’s sales. I think it’s extremely difficult to achieve it within 8 years. Second, their making stores are too fast than other companies. It also they invested their huge capital in order to expand overseas. I’m concerned about their...
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